AMOI Electronics yesterday reported a loss of 350 million yuan (US$46.36 million) in the first half.

This followed Ningbo Bird reporting a huge loss on Tuesday, which doesn't augur well for home-grown handset vendors.

Foreign giants, like Nokia and Motorola, launched series of the entry-level phones to compete with Chinese brands.

And black phones, those without government sales approval, also grabbed market share from home-grown players, industry insiders said.

Shanghai-listed Amoi Electronics reported a loss of 350 million yuan in the first six months compared with a 7.7-million yuan net profit a year ago, the company said in a statement to the Shanghai Stock Exchange.

Amoi's revenue was 1.54 billion yuan, a 42-percent drop year on year, the country's No. 3 handset maker said.

"Handset market competition was fierce and the black phones, with both low price and quality, have disturbed the market," Xiamen-based Amoi said in the statement.

Ningbo Bird, the country's No. 2 handset maker, announced its first-half loss was 237 million yuan and that revenue declined 40.12 percent.

From January to June, 23.43 million black phones, or a quarter of all the mobile phones sold in China, are changed hands, according to Beijing-based CCID Consulting, a research firm under the Ministry of Information Industry.

The copycats do not pay patent fees or taxes, so their products are price-competitive in the low-end market, where home-grown companies focus, industry officials said.

"They are both fighting foreign-brand makers and black phones and it is a tough time for all Chinese makers," said Luo Wen, CCID's president.

In the first half, Nokia, Motorola and Samsung's combined market share was 61.4 percent, adding 8.9 percentage points from a year ago. The home-grown firms' market share was only 30 percent, according to CCID.